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Carl Zeiss Microscopy, LLC v. Vashaw Scientific, Inc.

United States District Court, S.D. New York

January 2, 2020

CARL ZEISS MICROSCOPY, LLC, Plaintiff,
v.
VASHAW SCIENTIFIC, INC., Defendant.

          OPINION AND ORDER

          Vincent L. Briccetti United States District Judge

         Plaintiff Carl Zeiss Microscopy, LLC, a New York limited liability company, brings this diversity action against defendant Vashaw Scientific, Inc., a Georgia corporation, for breach of contract, or, in the alternative, for account stated and unjust enrichment.

         Before the Court is defendant's motion to dismiss the complaint pursuant to Rules 12(b)(1), 12(b)(3), and 12(b)(6). (Doc. #25).

         For the following reasons, the motion is DENIED.

         The Court has subject matter jurisdiction under 28 U.S.C. § 1332(a).

         BACKGROUND

         For the purpose of ruling on the motion to dismiss, the Court accepts as true all well-pleaded factual allegations in the complaint, and draws all reasonable inferences in plaintiff's favor, as summarized below.[1]

         On December 14, 2015, the parties entered into an agreement wherein defendant would conduct business as a “non-exclusive reseller” of plaintiff's microscopy products, services, and related accessories. (Doc. #25-1 (“Vashaw Decl.”) ¶ 2). The agreement became effective on January 1, 2016.

         Section 16 of the agreement, captioned “Applicable Law/Venue, ” states “the sole venue for arbitration or actions arising from this Agreement shall be in the courts in Westchester County, New York.” (Vashaw Decl. ¶ 4). In subsection 21.03, captioned “Bench Trial, ” the agreement provides:

Any dispute, controversy or claim (whether such claim sounds in contract, tort or otherwise) arising out of or relating to this Agreement (or the breach, termination or validity thereof), or arising in any way out of the relationship of the Parties will be settled by a ‘bench' trial . . . in the courts of Westchester County, New York.

(Id.).[2]

         Plaintiff alleges defendant failed to meet its minimum purchase requirements pursuant to the agreement and also owes plaintiff an outstanding balance on the products it did purchase. According to plaintiff, by 2017, defendant owed approximately $1 million in arrearages. In 2018, after learning defendant would not be able to meet its sales and payment obligations, plaintiff allegedly provided defendant notice of breach.

         Defendant now contends the Court should enforce the forum selection clause by dismissing this action so that it may proceed in a New York State court in Westchester County.

         DISCUSSION

         I. Standard of Review

         A. Rule 12(b)(1)

         “[F]ederal courts are courts of limited jurisdiction and lack the power to disregard such limits as have been imposed by the Constitution or Congress.” Durant, Nichols, Houston, Hodgson, & Cortese-Costa, P.C. v. Dupont, 565 F.3d 56, 62 (2d Cir. 2009).[3] A cause of action “is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it.” Nike, Inc. v. Already, LLC, 663 F.3d 89, 94 (2d Cir. 2011). The party invoking the Court's jurisdiction bears the burden to establish that jurisdiction exists. Conyers v. Rossides, 558 F.3d 137, 143 (2d Cir. 2009).

         When deciding whether subject matter jurisdiction exists at the pleading stage, the Court “must accept as true all material facts alleged in the complaint and draw all reasonable inferences in the plaintiff's favor.” Conyers v. Rossides, 558 F.3d at 143. “However, argumentative inferences favorable to the party asserting jurisdiction should not be ...


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